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@AdamRich_CAF "The Capital Allocation Almanac Vol. X When Tobacco Tried to Go Dairy In 1988 Philip Morris (now $MO) bought Kraft (then $KFT later split into $MDLZand $KHC) for $XX billion then spent the next XX years trying to undo it. A story of hubris focus and why great businesses can survive bad deals (but never because of them)"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XXX engagements

"Sources: Baker Hughes / Chart Industries M&A Call July XX 2025 Baker Hughes Investor Relations Press Release Oct X 2025 Reuters Chart Industries backs sale to Baker Hughes Oct X 2025"
X Link @AdamRich_CAF 2025-10-14T10:53Z XX followers, XX engagements

"CFO Joe Wolk said the spin will lift MedTechs growth and margins by XX bps. But with growth dominating managements language the deeper question is: Is this about productivity or about becoming a growth stock"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, X engagements

"The Great Unwind: $JNJ and $BASFY $JNJ isnt alone. $BASFYis also selling assets and scaling back investment unwinding decades of M&A-driven expansion. Both are moving from growth by accumulation to value by focus. The diversification model that defined industrial and healthcare leaders for decades is giving way to portfolio simplification and capital discipline"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, XX engagements

"Over decades diversification gave J&J resilience but diluted growth. After spinning off consumer health ($KVUE) and resolving key litigation J&J is now concentrating capitalaround its highest-ROI engine: pharmaceuticals. Pharma now represents XX% of revenueand drives the majority of R&D spend"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, XX engagements

"$JNJplans to spin off its orthopedics division DePuy Synthes sharpening focus on higher-growth areas: oncology immunology neuroscience cardiovascular surgery and vision. That ratio XXX mentions of growthto XX of margin says it all. The companys language mirrors its capital allocation: growth over margin"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, XX engagements

"Capital Allocation Lens: Capital Source:Mature slower-growth ortho assets Capital Use:Higher-ROI pharma and robotics businesses Capital Motivation:Refocus on where incremental returns remain highest Will this refocus be as successful as $GEs GEs breakup unlocked value by simplifying its balance sheet focusing management and aligning capital with core returns. Both $GE and $JNJ are products of an era that rewarded diversification and both are now unwinding it in search of higher ROIs. Not investment advice"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, XX engagements

"Sources: Johnson & Johnson Q3 2025 Earnings Call Oct XX 2025 Johnson & Johnson M&A Call Apr X 2025 BASF 2025 Strategy Update & Divestment Announcements Company IR & Bloomberg coverage"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, XX engagements

"Todays Capital Allocation Daily: $BKR makes its boldest inorganic bet yet leaving oilfields for industrial tech 👇"
X Link @AdamRich_CAF 2025-10-14T10:53Z XX followers, XX engagements

"All opinions are for educational purposes only. This is not investment advice or a recommendation to buy or sell any security"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"1988 The Deal of the Decade. Philip Morris spent $XXXX billionbuying Kraft roughly X book value and XX earnings one of the richest multiples ever paid for a food company at the time. Big cash flows. Few reinvestment options. Capital chasing narrative not returns"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"CAF Lens: Capital Source:mature high-margin OFS cash flows Capital Use:early-stage industrial tech with lower but durable ROI When a company reallocates capital away from its best business to fund the next one is that evolution or the end of a cycle Not investment advice"
X Link @AdamRich_CAF 2025-10-14T10:53Z XX followers, XX engagements

"Over the past five years $BKR has cut OFS exposure from XX% to 40%of revenue and redirected capital toward Industrial & Energy Technology (IET). CEO Lorenzo Simonelli said the shift makes Baker more industrial and less cyclicaldoubling exposure to non-oil and gas markets"
X Link @AdamRich_CAF 2025-10-14T10:53Z XX followers, XX engagements

"It took two decades billions of dollars and a spin-off to learn one timeless rule: The hardest part of capital allocation isnt finding what to buy. Its knowing when not to"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"They paid $XXXX billionfor Kraft (then $KFT later split into $MDLZand $KHC) in 1988. At spin Kraft was worth around $XX billion roughly breakeven after inflation and two decades of drag. Meanwhile $MOs core business created hundreds of billionsin value"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XXX engagements

"Historically $BKR favored organic reinvestmentand smaller tuck-ins. The $GTLS deal marks a step-change from capabilities-based M&A to a full portfolio reweighting. CAF view: this is inorganic diversification funded by a high-ROI core chasing growth in lower-return adjacencies"
X Link @AdamRich_CAF 2025-10-14T10:53Z XX followers, XX engagements

"Reality check: Kraft was already a strong slow-growth company. What worked for Marlboro wouldnt work for Miracle Whip. No real synergies just more brands under one roof. (NYT archives 1988)"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"What if they had spent that $XX billion on buybacks instead From 19882007 $MOcouldve cut its share count in half letting shareholders capture the compounding of its high-ROE tobacco engine directly. Sometimes the best allocation is inaction"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"Sources The New York Times (1988): Why Bigness May Not Matter A Muscular New Consumer Giant Smoke Clouds a Mega-Merger. The Wall Street Journal (2007): Smoke Clears for Kraft Spinoff"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"Todays Capital Allocation Daily: $JNJ said growth 103x and margin 14x on its earnings call then announced it would spin off its orthopedics business. Another global giant refocusing after decades of diversification 👇"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, XX engagements

"The irony: $MOstill outperformed for decades but because of its core business not Kraft. Great cash-flow engines can survive bad allocation. But they compound best when they stay in their lane"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"Orthopedics once a core pillar of J&Js MedTech segment will become a standalone business. CEO Joaquin Duato said the move creates a champion within orthopedics while freeing J&J to redeploy capital toward higher-return opportunities. Its a shift from breadth to focus and from defense to offense"
X Link @AdamRich_CAF 2025-10-15T15:35Z XX followers, XX engagements

"The unwind: By 2001 partial IPO. By 2007 full spin. What began as diversification ended in refocusing"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements

"$BKR s $13B Bet: Leaving Oilfields for Industrial Tech $BKRis acquiring Chart Industries ($GTLS)for $13.6B its largest inorganic move in decades. The goal: accelerate its shift away from oilfield services (OFS) toward energy & industrial technology. Does $BKR s diversification create an opening for others in OFS"
X Link @AdamRich_CAF 2025-10-14T10:53Z XX followers, XX engagements

"The hidden cost: Instead of reducing risk Philip Morris imported it. Tobacco litigation later made it nearly impossible to separate Kraft. It took XX yearsand millions in legal prep to unwind the deal. (WSJ 2007)"
X Link @AdamRich_CAF 2025-10-13T14:48Z XX followers, XX engagements